TEHRAN, Sept 27 (AFP) - Iran's reformist government hit back at its hardline rivals in parliament Monday, accusing deputies of frightening away investors by throwing into doubt two major deals signed with Turkish companies.
Desite anger in the embattled executive, the Guardians Council -- an unelected conservative body that vets all legislation -- gave its approval to the law passed Sunday by parliament.
"We cannot attract more foreign investment when we change our rules every day. These changes of rules and regulations overnight cannot guarantee investment. We desperately need investment, internal or foreign," government spokesman Abdollah Ramazanzadeh said in his weekly press conference.
On Monday the conservative-controlled parliament, or Majlis, voted to give itself the right to veto an airport operating contract signed with a Turkish-led consortium and a deal signed with Turkcell, Turkey's biggest mobile phone operator, to set up the first Iranian private mobile phone network.
Sunday's vote was an embarrassing blow to President Mohammad Khatami, forcing him even to cancel his visit to Turkey scheduled for Tuesday.
The official news agency IRNA reported the Guardians Council, a powerful political watchdog, approved the move in a letter from its head Ayatollah Ahmad Janati to Majlis speaker Gholam Ali Hadad Adel -- having judged the text "not to be contrary to Islamic law and the constitution".
Khatami was meanwhile engaged in a damage limitation exercise, telephoning Turkey's President Ahmet Necdet Sezar and Prime Minister Recep Tayyip Erdogan in a bid to ease the diplomatic fallout of his latest spat with Iran's religious right.
State media quoted him as saying he was obliged to accept the Majlis vote "as a token to democracy", while reassuring his Turkish opposite numbers that Iranian deputies were "keen to expand bilateral ties between our countries".
"A resolution between the government and Majlis will be soon worked out, thus preparing the ground for my trip to Turkey and stronger relations than before," Khatami said, calling the crisis a "natural disagreement" and emphasising the Majlis "has not annulled the deals."
But the blow to his standing was apparent when Ramazanzadeh was forced to fend off a question asking if Khatami -- who has seen his effort to liberalise Iran consistently blocked by hardliners -- would throw in the towel.
"As Mr. Khatami has said, he will carry on until the end of his mandate unless conditions change," Ramazanzadeh replied when asked if the latest blows to the president's authority would force him to resign before his second and final term ends in mid-2005.
Turkcell was awarded the contract following an open bidding process in February to become -- under the name Irancell -- Iran's second mobile phone operator. The deal is conditional on the payment of a 300-million-euro (366-million-dollar) licence fee.
The company would be expected to invest up to three billion dollars in the project, which would rank among the largest foreign investments in Iran since the Islamic revolution 25 years ago.
The legislation approved by parliament also targets a 200-million-dollar contract with Tepe-Akfen-Vie (TAV) -- a Turkish-Austrian consortium -- for construction and operations at Imam Khomeini International Airport.
In May, Iran's hardline Revolutionary Guards shut down the new Tehran airport, arguing that the contract with TAV endangered the Islamic republic's security because the operators also had business dealings with Israel.
Hardliners and conservatives took control of the Iranian parliament after most reformists and moderates loyal to the government were barred from standing in polls in February.